| Published: Saturday 7 August 2021, 11:21 pm [IST]
At a time when the primary market of IPO offers is booming and we are seeing that the market is tapped by around 1-2 new companies every week and the excellent listing gives the successful allotment participants reason to cheer. Therefore, when applying for the IPO as offered by the new company, the IPO applicant should consider the following points so that his application is not rejected due to incomplete or duplicate applications by the applicant.
7 points to keep in mind so that your IPO application is not rejected
Never apply for more than one application: For example, if you have two or more Demat accounts with different brokers and you submit multiple applications for an IPO because the same applicant, the offer will be void and you will not secure the IPO shares.
The PAN associated with the bank should match the PAN of the IPO applicant: Since the banker plays a key role in getting the IPO application money refunded at the time the application is rejected, the applicant should make the payment or freeze (ASBA procedure) from the same PAN-linked bank account for each IPO application PAN, otherwise they will she refused.
For HNI applications, never choose the cut-off price: The HNI investor who agrees to invest more than 2 Lacs Rs in the newly listed IPO may not tick the cut-off price option, as the HNI investor will be allocated shares at the upper price of the price range specified in the prospectus become. The cut-off price is the
Always choose the cut-off price for applications for institutional private investors: The retail institutional investor, who can invest up to Rs 2 lacs on each IPO, should select the cut-off price when submitting the IPO application form. The cut-off price is the offer price at which the company is willing to distribute its shares to its applying shareholders.
For applications for institutional retail investors applying below the shareholder quota: The retail institutional investor, who may invest up to Rs 2 lacs on each IPO, should select and apply for Shares within the quota of ownership provided by the Parent Company, if any, as specified in the Prospectus. However, these shareholders must consider the record date of ownership in these parent companies in order to be eligible for this quota.
The demat account should be active: When submitting IPO application forms, the investor should make sure that his demat details are correctly filled in and that the demat account should be active and not dormant.
IPO applications will be accepted beyond the deadlines: Many offline modes accept the IPO application up to the last minute in order to increase the number of subscriptions, where these last minute rushed IPO applications are directly rejected and not considered in the lottery allocation system.
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Story first published: Saturday, August 7, 2021, 11:21 pm [IST]